What is Commodity Trading Divergence?

What is Divergence Commodity Trading Definition? - Divergence is a commodity setup used by Commodities traders - commodities divergence trading involves looking at a commodity chart and a commodity indicator - for example MACD trading technical indicator.

To find this commodities divergence trading setup find 2 chart points which commodities price makes a new swing high or a new swing low but the MACD technical indicator does not do the same, this commodity signals a divergence between commodities price & MACD technical indicator momentum.

For a divergence commodity setup we look for 2 chart points, two highs which form an M shape on the commodities trading chart or two lows that form a W Shape on commodities trading chart. Then look for same M shape or W Shape on Commodity Trading MACD indicator.

Example of a Commodity Divergence Setup Trade Setup:

In the commodity chart below we spot two chart points, point A & point B (swing highs). These two commodity chart points form an M shape on the commodities price chart.

Then using commodity trading MACD technical indicator we check highs made by the MACD technical indicator, these are the highs that are directly below Chart points marked A and B.

We then draw one line on the commodities trading chart & another line on the MACD indicator.

Divergence Commodity Signals - What is Divergence Commodities Explanation? - What's Divergence Commodity Trading Definition?

The commodity chart above shows example of hidden bearish commodity trading divergence.

What is Divergence Commodities

In order to trade Commodity Trading divergence signal we look for the following:

• HH : Higher High - two highs but the last one is higher
• LH : Lower High - 2 highs but the last one is lower
• HL : Higher Low - two lows but the last one is higher
• LL : Lower Low - 2 lows but the last one is lower

Commodity Trading Divergence Commodities Terms Definition: What is Divergence Commodities? - What is Commodity Trading Divergence?

M shapes on Commodities charts dealing with Commodity price Highs

W Shapes on Commodities charts dealing with Commodity price lows

Example of M Shapes on Commodities Trade Charts - What's Bearish Divergence?

Examples of W Shapes on Commodity Trade Charts - What's Bearish Divergence?

What is Divergence Commodities? - What's Commodities Divergence? - What's Bearish Commodities Divergence? - What's Bullish Commodity Trading Divergence? - What's Divergence Commodities Explanation? - What's Divergence Commodity Trading Definition?